Analysis of SuperValu (SVU) annual report

1. SuperValu (stock symbol: SVU) uses KPMG LLP as its independent accountants (SuperValu, 2000, p. 32).

2. According to KPMG LLP, the financial statements (including the statement of cash flows) were prepared in accordance with generally accepted accounting principles as practiced in the USA. KPMG LLP believes that the company does not appear to have deliberately misrepresented its financial position (SuperValu, 2000, p. 32).

3. The external audit verifies that the procedures used to develop financial information issued by the company are valid and in keeping with standard accounting and control practices. External auditors look for irregularities in reporting practices or in the way in which inventory is handled (for example) to determine that the information on financial statements is fundamentally valid. External audits do not verify the accuracy of the financial statements themselves, but merely validate that the procedures used to produce those statements are in keeping with standard practice (SuperValu, 2000, p. 32).

4. When an auditor prepares a report stating that the financial statements have been prepared in accordance with generally accepted accounting principles, the auditor is telling the company (and its shareholders) that the financial statements are most likely an accurate representation of the company's financial position. If an audit report states that there are irregularities, the company cannot depend on its financial statements to reflect acc

Related Essays

The Limits of SWOT Analysis An evaluation of an organization's strengths and weaknesses with respect to environmental threats and opportunities is called a SWOT analysis, capturing the .... (983 4 )

INVESTMENT ANALYSIS INVESTMENT ANALYSIS: GOLDEN ENTERPRISESA CASE ANALYSIS This research presents an investment analysis of Golden Enterprises, Inc. As Golden Flake Snack Foods. .... (1132 5 )

Financial analysis Financial analysis is a multi-pronged process used to identify possible financial strengths or weaknesses inherent within a business plan, project, or product .... (950 4 )

Nike: Strategic Analysis CASE STUDY: NIKE, INC. � 2000 [MATRIX-BASED STRATEGIC ANALYSIS] The analysis of the Nike, Inc. � 2000 case involves the use of .... (1211 5 )

Wireless Telecommunications Analysis Analysis of Telecommunications Industry The telecommunications industry is concerned with multiple communications media, including television, radio, voice .... (7412 30 )

The DuPont Analysis The DuPont analysis begins with an assessment of the component contributions to return-on-investment (ROI). In DuPont analysis, ROI .... (1362 5 )

alculated by taken the company's value of common stock and paid-in capital ($282,896,000) (SuperValu, 2000, p. 21) and dividing by the number of shares issued (130,090,000) (SuperValu, 2000, p. 34) yielding an average price of $2.17461757. 11. Information from the company's financial statements is summarized below (SuperValu, 2000, pp. 18-23) and used in the calculation of financial ratios. Balance Sheet ($Thousands) 2000 1999 Cash 10,920 7,608 A/R 562,448 410,799 Inventory 1,490,454 1,067,837 Other Current Assets 113,817 96,283 Current Assets 2,177,639 1,582,527 PPE (gross) 3,477,649 2,920,412 PPE (net) 2,168,210 1,699,024 Other 2,149,504 984,398 Total Assets 6,495,353 4,265,949 Notes, A/P 2,006,825 1,071,118 Current Portion LT Debt 170,381 208,913 Accrued Compensation 128,875 96,161 Other Current 203,539 145,715 Current Liabilities 2,509,620 1,521,907 LT Debt 1,408,858 835,485 Other Liabilities 755,396 602,918 Total Liabilities 4,673,874 2,960,310

Category: Business - A